Daily Price Action
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NZDJPY Channel to Produce Selling Opportunity

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Like other yen pairs, NZDJPY has been trending higher since January 3rd.

The pair is off its year-to-date low by more than 600 pips despite some recent weakness.

However, the ascending channel below illustrates a bit of fatigue from buyers.

An ascending channel by itself is not bearish. It represents an uptrend hence the higher lows and higher highs that give the pattern its shape.

But a 200-pip ascending channel that has been in play for two months could be a sign of an imminent decline.

Theoretically, an equidistant channel can go on forever. Of course, we all know that doesn’t happen.

The likely scenario is that bids will eventually dry up and sellers will regain control.

And it isn’t just this channel that makes me believe a move lower is imminent.

The fact is NZDJPY has been trending lower since the start of 2015.

One could argue that the pair failed to carve a lower low during the January 3rd flash crash.

And they’d be correct. But the momentum still favors sellers while below the 77.00 handle.

The real opportunity here, in my opinion, will materialize following a daily close (New York 5 pm EST) below channel support near 75.00.

Such a close would expose a key level that needs no introduction at 72.40.

Key resistance comes in at 76.40 followed by 77.00. The latter is the trend line that extends from the 2014 high.

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NZDJPY ascending channel on daily time frame

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16 comments
Emuobo says

I had my eye on this after that dojo on the weekly close last week. Thanks for the pointers..

Reply
    Justin Bennett says

    You’re welcome.

    Reply
NinjaForex says

thanks for suggest analisy

Reply
    Justin Bennett says

    My pleasure.

    Reply
      Kinyunyi says

      I always appreciate your analysis.

      Reply
        Justin Bennett says

        And I appreciate your support. 🙂

        Reply
Praise says

Just on time… Thanks for that.

Reply
    Justin Bennett says

    You’re welcome.

    Reply
Uzoma Nnamdi says

Great analysis sir

Reply
    Justin Bennett says

    Thanks, Uzoma.

    Reply
oludare says

Justin, great analysis. I am a member and a great fan of yours but it seems to me you don’t share your entry prices when you enter a trade or am i missing something?. Anyways joining DPA was a good decision for me last year even though it cost me my long time savings.

Reply
    Justin Bennett says

    I share my entries with members, but I don’t trade everything I discuss on this site. Keep in mind that I usually only trade a few times each month.

    Reply
John Mtemasango says

Hi Justin….m still new in trading, but would l be correct to say this setup you have commented on is a bearish flag in formation?

Reply
    Justin Bennett says

    I wouldn’t label it as a bearish flag. It doesn’t meet the criteria, at least not for me.

    Reply
      Charl says

      Thankyou Thankyou so much Sir Bennett

      Reply
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